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Stores Will Hear a Pin Drop This Holiday Season

Looks like there's going to be a lot of space under our Christmas trees this year. And stockings will hang like sad, skinny socks from our fireplace mantels. At least that's what economists have said, along with a survey of 8,000 Americans.

Consumers will be shelling out 2.2 percent more on holiday gifts this year than last, which means we'll be spending a mere $470.4 billion on gifts, according to a recent forecast by the National Retail Federation. Usually our holiday spending goes up 4.4 percent, making this year one of the slowest growth holiday seasons since 2002.

A consumer survey by BIGresearch in early September, before the financial crisis hit, found that 52 percent of people said they would be spending less this year and 42 percent said they would be spending the same. And who are the six percent of you that said you would be spending more? Maybe we could become friends or something.

The prediction isn't surprising. My 4-year-old could have called this one. Here's the problem: We never know how much we're going to be shelling out for gas each week, some of us have foreclosed on our homes, the craziness on Wall Street has turned us into nervous Nellies about our investments and who knows who'll end up in the White House. It's enough to make a shopping blogger cut up her credit cards and go on another fiscal fast. (My husband is celebrating right now.)

They say even luxury retailers will be offering discounts. But home furnishing stores will suffer the hardest and we may not be buying as many gift cards, which was a huge holiday item last year. But we'll still show some love for electronics, which may have some good deals.

Now, don't panic. Black Friday (the day after Thanksgiving that kicks off the holiday shopping season) and Cyber Monday (the Monday after Thanksgiving that kicks off the online holiday shopping season) have not been cancelled. In fact, shoppers might feel a little better about spending money by then because we'll know who the next president will be.

So here's what I think: Retailers will need to get a little creative with their sales this year, online stores will need to offer free shipping no matter how much we spend at their site, kids will need to realize that one or two gifts from Santa is more than enough, pot luck dinners need to become fashionable again and we need to re-think what the holidays are all about.

How are you going to handle the holidays this year in terms of gifts and food? Will your spending go down, up or stay the same as last year? Have any ideas for gifting friends and family without depleting your savings? Post a comment below.

Comments

I'm spending less this year, but I'm also trying to shop smarter. I'm getting a lot of little things for my family members, which makes it look like more than I spent. I'm also trolling art shows and Etsy.com for unique, affordable gifts. And, in some situations, I'm buying used. I could spend $15 for a book at Borders, or $5 for the same book at a used bookstore. They both read the same!

Posted by: Liz | September 25, 2008 11:39 AM

We have decided we can't spend much this season. Wallets are tight. Instead, we will try to save for our vacation next year. To be honest, it feels good not to shop much this year...maybe the Holidays will actually be relaxing for once.

Posted by: ShopLess | September 25, 2008 12:39 PM

I agree with ShopLess - less shopping will make the holidays relaxing at last. Too often I've caught myself at the mall on Dec 23rd desperately trying to find something - anything! - for a relative. This year will be all about the kids in the family. The adults can make do with a book or sweater.

Posted by: Cody | September 25, 2008 1:19 PM

I definitely want to avoid the malls this year. I think it's all going to be online this time!

~ Kira ~
pstoh2k8@iucsnrg.com

Posted by: Kira Reyes | September 25, 2008 2:16 PM

I've reduced my spending AND giving over the last few years. People (in my family, at least) just have way too much stuff. I've started giving things that can be used up - gourmet coffee, hot chocolate, popcorn. Soy candles for the candle lover. I've nicely told my family and friends: no more clothes, no more knickknacks, etc. It's working out great!

Posted by: WI | September 25, 2008 2:18 PM

This year my family has chosen to do secret santa with a $50 spending limit. We also have agreed that it needs to be more personal too such as home made gifts like spices or a donation to a favorite organization. Who really needs more "stuff"?

Posted by: PQ | September 25, 2008 3:12 PM

I don't normally spend too much at the holidays since there are only a few people for whom I buy presents. But I'll be even more attentive since I'm traveling this fall and I will be performing major home improvement afterwards.

Posted by: Little Red | September 25, 2008 8:53 PM

Magazine gift subscriptions make for good, affordable presents these days, and it's a gift that will come every week or month. With many fighting circulation and advertising drops just as newspapers are, they are offering unbelievable deals. My favorite entertainment weekly (which goes by that name) just offered me a year's renewal *and* a gift subscription for $15!

Posted by: John | October 2, 2008 9:42 AM

We are 55 and still hope to retire in five years, plus we own house we live in and one in LA lived in by my older girl.I am making careful lists to be generous but not waste cash. This year I'm shopping for my teen and my law student daughters for items new w/tags (NWT)on Ebay (found a NWT A.Vittadini woven leather tote under $80 for law student), giving patterned pashminas I bought in a Paris market, and making paintings of a lovely medieval courtyard in Provence (I took about two dozen photos of every angle of it during a painting workshop there in May). Most other shopping will be online to avoid impulse buying. Will shop mall only on a morning off from work during the week; too crazy for me at Christmas and Hannukah!